Tozour Energy Systems, Inc. v. Director, Division of Taxation

MENYUK, J.T.C.

This matter comes before the court on cross-motions for summary judgment. The issue is whether plaintiff Tozour Energy Systems, Inc. is required to pay sales or use tax on the purchase of parts it uses in performing work for New Jersey customers under service contracts. The service contracts cover parts and labor and plaintiff collects sales tax from its New Jersey customers on the full price of the contract at the time that the contracts are sold. Plaintiff contends that, because it collects sales tax on the service contracts, the parts would effectively be taxed twice if…